Spl. Officer And Competent Authority, Urban Land Ceiling Hyderabad & Another v. P. Ramanamma .

1. This writ appeal filed by the Special Officer and Competent Authority under the Urban Land Ceiling Act challenges the order of a learned single Judge allowing the writ petition and issuing a mandamus directing the appellants to consider grant of permit to the writ petitioner under Sec. 26 of the Urban Land (Ceiling and Regulation) Act, 1976 (hereinafter referred to as ‘the Act’) after quashing the impugned order rejecting the application filed by the writ petitioner therefor.

2. The relevant facts that gave rise to the present proceedings in brief are: The writ petitioner was a member of Navodaya Co-operative House Building Society Limited, Hyderabad. The Society having entered into an agreement of sale with one Fasahatulla in respect of an extent of Ac. 11-11 guntas in S. Nos. 97/1, 100 and 101 at Yallareddyguda, Golconda taluk, Hyderabad, filed a suit for specific performance of that agreement and pursuant to the decree obtained therein, had a registered sale-deed dated 26-8-1984 executed in its favour. In its turn, the Society executed a sale-deed in respect of plot No. 2 measuring an extent of 900 sq. yards, having had that land divided into plots, in favour of the petitioner on 30th April, 1985. Thereafter, the writ petitioner wanted to sell the plot to a third party and for that purpose, made an application on 14-7-1988 to the 1st appellant under Sec. 26 of the Act for issue of necessary permission. That application was rejected, through the impugned order, on the ground that it could not be considered for want of previous clearance. The appellant herein filed a counter-affidavit stating therein that the lands in question in S. Nos. 97/1,100 and 101 were covered by the state ment filed in Form I under Sec. 6(1) of the Act by Fasahatullah, the vendor to the Society, and after inquiry the declarant-Fasahatullah, was found to be surplus vacant 1 and-holder to an extent of 51,205.67 sq. metres as per the draft statement dated 19-5-1982 prepared under Sec. 8(1), and also finally as per orders made on 19-6-1982 under Sec. 8(4) of the Act. It is further stated, as per Section 5(3) no person holding vacant land in excess of the ceiling limit before commencement of the Act shall transfer such land, or a portion thereof, and any such transfer made in contravention thereof shall be deemed to be null and void. Further according to Sec. 42 of the Act, any decree or order will have no effect upon the provisions of the Act. Hence, according to the Counter filed the decee of the civil Court in pursuance of which the sale-deed dated 26-8-1984 came to be registered by the Sub-Registrar, Khairatabad, Hyderabad, is not valid and consequently no valid title is vested in the Society by virtue of the registered sale-deed and much less in the subsequent purchaser—the writ petitioner, from the Society. After considering the rival contentions of the parties, the learned single Judge allowed the writ petition holding that under Sec. 26 of the Act, the authority has only to consider whether it wants to purchase the land and if not to issue the permission. Aggreived of this order the appeal is brought in.

3. The learned Government Pleader for the appellants contended that the plot in question sought to be sold is a portion of the vacant land held in excess of the ceiling limitby the vendor Fasahatulla as per orders passed under Sec. 8(4) of the Act, that under Sec. 5(3) of the Act the said Fasahatulla is forbidden from transferring the vacant land or a portion thereof by way of sale, mortgage, gift; lease or otherwise until a notification regarding the excess vacant land held by him has been published under Sec. 10(1) and any contravention thereof would result in rendering such transfer to be mill and void: Further as per Sec. 10(4) the prohibition is continued until the proceedings crossed the stage covered by Sec. 10(3) and in the interregnum commencing from the stage of proceedings from Sec. 10(1) to 10(3), any transfer effected of the notified vacant land or a part thereof by way of sale, mortgage, gift, lease or otherwise shall be deemed to be null and void. In view of these specific provisions, viz., Sec. 5(3) and Sec. 10(4) the proceedings in the instant case having stood at the stage covered by Sec. 8(4) and not terminated by crossing the stage covered by Sec. 10(3), the sale effected in favour of the society itself by Fasahatulla, may be under a decree of the Civil Court, is, according to the learned Govt. Pleader — null and void, more so in the light of Sec. 42 of the Act, and therefore the authorities have rightly rejected the application made under Sec. 26 of the Act by the writ petitioner. On the other hand, the learned counsel appearing for the original writ petitioner, sought to have the order under appeal sustained by contending that the only op Hon of the authorities is to consider purchase of the vacant land covered by the application under Sec. 26 of the Act and when it was not so inclined, it has no alternative except to grant the permission and therefore the writ petition was rightly allowed.

4. In view of the above rival contentions, the only point that arises for consideration is, whether the competent authority under the Urban Land (Ceiling and Regulation) Act, 1976 has no power to reject the permission sought for under Sec. 26 of the Act on the ground that the land in question, for which the permission is sought, is part of the vacant land covered by the proceedings resultant of the statement filed under Section 6 of the Act.

5. To appreciate the above question, it is relevant, at the outset, to note the Statement of Objects and Reasons of the Act, which reads:

“There has been a demand for imposing a ceiling on urban property also, especially after the imposition of a ceiling on agricultural lands by the State Governments. With the growth of population and increasing urbanisation, a need for orderly development of urban areas has also been felt. It is, therefore, considered necessary over the scarce resource of urban land with a view to ensuring its equitable distribution amongst the varioussections of society and also avoiding speculative transactions relating to land in urban agglomerations.”

6. As per the above statement of objects and reasons the main aim of the legislation is to provide for the imposition of a ceiling on vacant land in urban agglomerations, for the acquisition of such land in excess of the ceiling limit, to regulate the construction of buildings on such land and for matters connected therewith, with a view to preventing the concentration of urban land in the hands of a few persons and speculation and profiteering therein and with a view to bringing about an equitable dis tribution of land in urban agglomerations to subserve the common good. The material provisions of the Act having a bearing on the present matter are Sections 3, 4, 5, 6, 8, 9, 10, 26 and 42. Section 3 of the Act imposes a prohibition against holding of vacant land in excess of the ceiling limit, while Section 4 envisages the ceiling limits. Section 5 of the Act deals with Transfer of vacant land. Sub-section (3) of Section 5, which has a material bearing, reads:

“(3) In any State to which this Act applies in the first instance and in any State which adopts this Act under clause (1) of Article 252 of the Constitution, no person holding vacant land in excess of the ceiling limit immediately before the commencement of this Act shall transfer any such land or part thereof by way of sale, mortgage, gift, lease otherwise until he has furnished a statement under Section 6 and a notification regarding the excess vacant land held by him has been published under sub-section (1) of Section 10 and any such transfer made in contravention of this provision shall be deemed to be null and void.”

7. Therefore, as per Sec. 5(3) there is a specific bar against any person holding vacant land in excess of the ceiling limit from transferring the whole or any part of such land by way of sale, mortgage, gift, lease or otherwise until he files a statement under Sec. 6 and a notification is issued under Sec. 10(1) of the Act. The section further makes it specifically clear that any transfer in contravention of the provision shall be deemed to be null and void. Section 6 obligates every person holding vacant land in excess of the ceiling limit to file a statement before the Competent Authority under the Act. Under Sec. 8 the Competent Authority decides the statement filed under Sec. 6 and prepares, first, a draft-statement and after service of the draft-statement on all concerned passes an order disposing of the objections, if any filed under Sec. 8(4)., It is under Section 9, pursuant to the disposal of objections as per Sec. 8(4), the competent authority with the necessary alterations in the draft-statement determines the vacant land in excess of the ceiling limit, and that will be the final statement in respect of the person that filed the statement under Sec. 6 of the Act. Sub-sec.(1) of Section 10 of the Act envisages publication of the notification giving particulars of the vacant land in excess of the ceiling limit covered by the final statement under Sec. 9, and expressing proposals for acquisition of the same by the Government, while at the same time calling for claims of any persons interested therein. Under sub-section (2) of Section 10, the competent authority shall determine the claims, if any, filed pursuant to the notification issued under Sec. 10(1) of the Act. Sub-section (3) of Sec. 10, provides that at any time after issue of notification under Sec. 10(1) the competent authority may notify through publication in the Gazette declaring that the excess vacant land covered by the notification under Sec. 10(1) be deemed to have been acquired by the Govenrment. Sub-section (3) of Sec. 10 further clarifies that on such a declaration the vacant land shall be deemed to have vested absolutely in the Government. Sub-section (4) of Sec. 10 envisages prohibition against transfer of vacant land during the period commencing from Sec. 10(1) and ending with Sec. 10(3) and also declares that any transfer made in contravention thereof shall be deemed to be null and void, apart from further laying prohibition in regard to altered use of such excess vacant land. Then follows the crucial provision, Section 26. It provides that no person holding vacant land within the ceiling limit shall transfer such land, except after giving notice regarding the intended transfer to the competent authority. Section 42 of the Act declares over-riding effect of the Act as against other laws. It postulates that the provisions of the Act shall have effect notwithstanding anything inconsistent therewith in any other law, decree or order of a Court.

8. In the instant case it is not disputed that Fasahatulla, the Vendor to the Society, from whom the writ petitioner purchased the plot in question, had filed a statement under Sec. 6. Further, as per the averments in the counter, in the inquiry held pursuant to the statement, the said Fasahatulla was found to be holder of vacant land in excess of the ceiling limit, to an extent of 51,205.67 sq. metres, under sub-sections (1) and (4) of Sec. 8. If at all, the writ petitioner or the society ought to have filed their objections to the draft-statement prepared under Sec. 8(1) before the competent authority. But that does not seem to have been done. Since the stage has gone to finalisation of draft-statement under Sec. 8(4) the authorities will follow the procedure envisaged by Sections 9 and 10 during which again the writpetitioner or the society will have the opportunity of making their claim to the notification to be published under Sec. 10(1). Be mat by Sec. 5(3) and also by Sec. 10(4) of the Act, against transfer of the whole vacant land as per the former provision and of the notified excess vacant land as per the latter provisions, and in the face of the statement filed by Fasahatulla under Sec. 6 and the pendency of the proceedings as noted; the very sale of the land, may be under the decree of the Court, in favour of the society is not free from cloud, more so by virtue of the over-riding effect of the Act under Sec. 42.

9. Still, the question that remains is whether the competent authority has no power to reject the permission sought for under Sec. 26, though there is prohibition against such transfer by Sections 5(3) and 10(4). It must be noted that the very authority which itself has to get the land acquired cannot be relegated to the position of following the provisions of the Act therefor, while at the same time granting the permission under Sec. 26, in the facts and circumstances of the present case. Section 26 of the Act must be read along with Sections 5(3) and 10(4), and if so read in a case covered by either of the two provisions, viz., Sec. 5(3) or 10(4), like the one on hand, the rejection of the permission under Section 26 of the Act cannot be held to be either arbitrary, illegal or resultant of any infirmity. It is relevant to note here that as per Sec. 42 of the Act, the Act has over-riding effect over the decree obtained by the Society from the Civil Court and therefore that decree cannot be said to have any prevailing effect.

10. The decision of this Court in Bansilal v. Competent Authority 1985 1 ALT 239. relied upon by the learned counsel for the writ petitioner is of no help to him for the simple reason that there also it is held that the competent authority can reject the permission under Sec. 26 on the ground that the notification in respect of the holding (in the instant case of Fasahtulla) is not issued under Sec. 10 of the Act. It is useful in this context to read paragraph 9 of the said decision:

“Section 26 has no application when a person owns land beyond the ceiling area or the notification under Section 10(1) is not issued if he filed a statement under Section 6 of the Act. Thus, when we read Section 26 along with Section 5(3) and Section 10(3), it is clear that the competent authority can hold that a notice under Section 26 cannot be entertained either on the ground that the applicant holds vacant land beyond the ceiling area or the notification in respect of his holding is not issued under Section 10 of the Act.”

11. No doubt, the learned Judge in that decision was dealing with a different fact-position unlike the present one. It is in respect of the holding of Fasahatulla, the Vendor to the Society, that the notification under Sec. 10(1) is not issued, while the application under Sec. 26 is made by the writ petitioner, a purchaser from the Society. The ratio in mat decision, viz. “If in respect of a holding any declaration is pending and subsequently the said holding vests under Section 10(3), the applicant” (the writ petitioner in the case on hand) cannot have any remedy and the issuance of notice under Sec. 26(1) or omission to pass an order by the competent authority on suchapplication would not protect the applicant” is no consolation to render it unnecessary “for the competent authority to go into the title or bonafide nature of the claimoftitle when a notice is issued under Section 26” inasmuch as it results in frustration of the very aim and object in bringing out the legislation, viz., preventing concentration of urban land in the hands of a few, aiming to regulate construction of buildings on such land and to bring about an equitable distribution of the land. In this view of the matter the order of the learned single Judge quashing the impugned order rejecting permission under Sec. 26 is not sustainable and accordingly by setting aside the order under appeal, the appeal is allowed. There will, however, be no order as to costs.